Australia's top grain exporter has been banned from sending barley to China after it disputed claims that pests were found in multiple shipments.
Western Australian grain handler CBH vowed to fight the "extremely disappointing" decision, which appears to be the latest trade strike fuelled by diplomatic tensions.
Finance Minister Mathias Cormann said the Federal Government wanted to get to the bottom of the situation.
“We do respect the fact that China — like any other country would, like we would — has got quarantine inspection arrangements,” he told reporters in Canberra on Wednesday, September 2.
“We will be working with the company once we are aware of all the facts to make the appropriate representations.
“China's customs department confirmed the decision on Tuesday (September 1), saying quarantine pests were found in CBH barley exports multiple times.”
But the grain co-operative insisted there was no evidence to support the claim.
“CBH is therefore extremely disappointed the suspension has been put in place and will continue to work with the Australian government to challenge the suspension,” the exporter said.
Australian farmers were already effectively blocked from exporting barley to China, which imposed tariffs of 80.5 per cent on the commodity in June.
Senator Cormann said CBH had a great track record, but declined to speculate if diplomatic issues had sparked the ban.
“The truth is, Australia's grain products, Australia's barley products, are highly regarded all around the world,” he said.
“If there is less opportunity to export high-quality Australian grain into China there will be more opportunity to export grain into other markets around the world.”
Labor leader Anthony Albanese said relations between Australia and China were bad.
“It's a real issue that Australian ministers can't pick up the phone and seem to have no relationship with their Chinese counterparts,” he told ABC radio.
“China is the largest recipient of our exports, by a long way. It is a real concern that the Australian government don't seem to be able to manage the relationship.”
China has also launched anti-dumping investigations into Australian wine and suspended beef imports from five Queensland abattoirs.
The value of Australian agricultural exports reached $50.1 billion in 2019/20 — the second most valuable year on record — despite a year-on-year decline of $601.4 million, according to Rural Bank’s Australian Agriculture Trade 2019/20 report.
The slight decline marks the end of nine years of consecutive growth, but shows the resilience in the value of agricultural exports in the face of drought and, more recently, the COVID-19 pandemic.
China accounted for 30.3 per cent of total export value, continuing to be the biggest market for Australian agriculture. Australia’s top five export markets were China, Japan, the United States, South Korea and Indonesia.